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TMI Blog2018 (10) TMI 1021X X X X Extracts X X X X X X X X Extracts X X X X ..... ad both the parties. Case file perused. 2. The assessee's sole substantive ground raised at the time of filing challenges the CIT(A)'s action affirming assessment findings making sec. 68 of Rs. 3 lac. It has also raised an additional ground in the instant appeal challenging validity of sec. 158BD proceedings for want of necessary satisfaction that the undisclosed income in issue belongs to an assessee other than the searched assessee. Learned counsel quotes hon'ble apex court's judgment as "NTPC"'s case 229 ITR 383 (SC) settling the law that such an additional ground can be raised in tribunal in order to determine credit tax disability in case necessary facts are already on recod. We therefore admit this additional ground raised at ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prayed for. 8. That further ground or ground of appeal may be taken on or before the date of hearing. 3. The brief facts of the case are that search u/s. 132 was conducted on 07- 05-2002 at the premises of the UIC group. The AO on the basis of the material found in respect to the search initiated proceedings u/s. 158BD in the case of the assessee. The impugned assessment was made on 30-11-2006 at the undisclosed income of Rs. 3,03,000/-. In the ground of appeal, the assessee has challenged the legal validity of the proceedings u/s 158BD and also the additions of Rs. 3,00,000/- under section 68 on protective basis and Rs. 3,000/- on account of commission. The Ld AR has fairly conceded that the issues in the present appeal are already co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both the parties and perused the records. We note that the assessee is a private limited company engaged in the business of trading/dealing in shares. A search and seizure operation was conducted in the UIC group of companies on 7.5.2002. Pursuant to the said search, share scrips of UIC Companies allotted in the name of the assessee company were found in their premises and they were seized during search operation. Thereafter, the AO notes that during post search enquiry, conducted for ascertaining the source of investment by the assessee company, the A.O. found that the assessee company received the funds from 4 bank accounts viz, A/c nos.4886, 4914, 4933 & 4934 maintained with Federal Bank of India. Burra Bazar Branch Kolkata which were s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es seized from the premises of UIC Group did not belong to it, when the search was conducted on 07.05.2002. According to the assessee, the scrip's in question had already been sold during years 1999, 2000 and 2001, so on the date of search the scrip's found and seized does not belong to it. According to the assessee company, when the search happened on 07.05.2000, it had already sold the shares which it had purchased during October and November, 1999 and February, 2000 to the aforesaid four persons for a consideration of Rs.l,21,65,000/-. In connection with amount of Rs.l,21,65,000/- the Ld. AR of the assessee-company drew our attention to the following facts: i. The appellant company had sold its investments in shares of UIC Companies be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r than the person with respect to whom search was made under section 132 or whose books of account or other documents or any assets were requisitioned under section 132A, then, the books of account, other documents or assets seized or requisitioned shall be handed over to the Assessing Officer having jurisdiction over such other person and that Assessing Officer shall proceed under section 158BC against such other person and the provisions of this Chapter shall apply accordingly.' A bare perusal of the above section indicates that before the provisions of section l58BD are invoked against a person other than the searched person, two conditions are required to be fulfilled: i. For assessing the undisclosed income of any other person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on l58BD and notice under section l58BD can be validly issued. Therefore, existence of material belonging to assessee must be found during the course of search, which is a sine qua non for taking action under section 158BD of the Act. So, the jurisdictional fact to invoke sec. 158BD against the assessee is the seizure of material belonging to assessee found during search conducted on 07.05.2002. Now the question is, can the seized shares found during search on 07.05.2002 at UIC Group can be said to be belonging to assessee-company. From the facts emerging as noted by us the assessee company though had purchased the shares of certain UIC Group companies in October, November, 1999 and February, 2000, it had been sold to the four persons named ..... X X X X Extracts X X X X X X X X Extracts X X X X
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